Costco may hike its membership fees — here's how much more you'd pay

Costco is expected to raise its membership fees by nearly 10% in the next couple of months.

The warehouse chain's fees will most likely increase by $5, to $60, for its basic membership and by $10, to $120, for its executive membership, according to UBS analyst Michael Lasser.

The fee hike could be announced Thursday along with the company's second-quarter earnings report, though it is more likely to come in the third quarter, Lasser wrote in a research note published Monday.

Costco hasn't confirmed a fee hike, but it also hasn't ruled one out.

During an earnings call in December, Costco CFO Richard Galanti suggested the time may be right for the company to raise fees, though he hedged that by saying, "I'm not trying to suggest that it's tomorrow afternoon."

Several months earlier, Galanti had highlighted the fact that Costco had raised its fees every five to six years and that January 2017 was the fifth anniversary of its most recent fee hike in the US.

The company recently increased its membership fees by 10% in Taiwan, Korea, Japan, Mexico, and the UK.

Fee increases shouldn't have a major impact on sales and membership renewals, which are at a rate above 90% in the US and Canada, Lasser said. In fact, an increase should support a boost in shares, he said.

"Traffic growth was solid across the company in December and January (up an average of 4% in the US and 3% worldwide)," Lasser wrote. "This suggests members continue to be intrigued by the company's value proposition, and leads us to believe that renewals likely at least remained steady at 90.3% in the US and Canada and 87.5% worldwide."

UBS estimates that Costco's income from membership fees rose 6.7% in the second quarter of the year to $643.5 million compared with the same period last year. The firm is also estimating that same-store sales grew 3.7% during the period.